Married, SAHM - why don't I get to use my personal allowance?

[Daffodilly]

Can someone help me understand this. DH earns a good income (higher rate taxpayer). Partly because he works long hours to earn this, and also because we can fortunately afford to and I want to, I am a SAHM.

My question is that because I don't work I don't get to claim any of my tax free allowance. Why can't I give him my tax free allowance as he is working to support me?

I'd genuinely like to understand the rational as it seems unfair (though I realise just one of many things that aren't fair in our tax system)?

SM I think the question was intended for me.

thanks for clarification

Jinsei I think maybe the point is that you would be at home with your kids, but maybe claiming that they're being looked after by your friend?

If you have a friend who you spend a lot of time with anyway, I suppose you could all be together, but claim she is being paid to look after your children and you to look after hers!

Jinsei I think maybe the point is that you would be at home with your kids, but maybe claiming that they're being looked after by your friend?

That would be fraud, I presume.

But if there is no financial benefit, I still don't understand the point. Maybe I am just being dense, but I fail to see how you could make any money out of this arrangement, or what other conceivable benefit there might be!

OP - you can ask him to get rid of any joint accounts and put all his savings (apart from his ISAs) into your bank account (solely in your name), then he'll be able to enjoy some of your tax free allowance. Also any dividend on shares to be paid to you. That's if he trusts you to be in charge (legally) of his loot, lol. Then just pay a bit to him into a current account in his name or joint names for him to use as spending cash. Actually, I think this is a Japanese custom - I'm not sure if Japanese couples still do this, but I was told ages ago that this was the norm. For the pragmatic reason that many husbands did not want to bother with calculating the household expenditure and fiddling with statements and cheques. I suppose they also trusted their wives to shop around for the best interest rates and mortgage deals, lol.

This used to happen. I have done it myself - wife to husband -, so that must have been in the 80's - unless you could still do it 97-98. The gvt have reduced Home Responsibility Protection, I think that was a mistake.

There also used to be the Married Woman's reduced NI - a terrible thing, and the reason why DM gets a small state pension compared to most (but luckily has a little other income so doesn't need Pension Credit). You could claim on your husband's contributions though.

Think the above is true. It's all so long ago now...

I don't know! I was only commenting that the lots of paperwork/ofsted/self-employed arguments would be resolved by being nannies rather than childminders.

Ofsted do have rules in place to avoid people using childcare vouchers to pay family members to care for their children. I think it must be worth it otherwise people wouldn't bother doing it.

Still think a US system works better where you can claim tax rebates on a.) the number of dependents you have and b.) 35% of childcare or adult dependent care costs. That evens up the playing field to an extent between the WOHPs and SAHPs and makes no value judgement that SAHP is better for family life, as no government should since that is not proven in any way.

What I think is more unfair in the UK than the lack of a transferable TFA between couples is that childcare costs are not at all tax deductible. That actually traps women at home more than anything else because so many women can't justify the cost of WOH given the cost of childcare.

And yes, I know the MN mantra that childcare costs have to be calculated on both partners' salaries to determine whether it's worthwhile for each of them to work - and I agree with it - but in practice many women just look at their take-home pay, look at the bill to their creche/CM and think, 'what's the point?'

yes, I get that it would be less paperwork for nannies, but there would still be quite a lot of bureaucracy if they wanted to use childcare vouchers.

I can't imagine that the amount saved by using childcare vouchers would be worth the hassle tbh. And I can't see what other advantage there might be!

You don't pay tax on childcare vouchers, it's not a huge saving, but better than nothing.

yy, I know that, but hardly such a big saving as to make all the paperwork worthwhile. I don't know, maybe they would get tax credits too, but I thought the household income had to be pretty low to qualify for this.

Jinsei I don't know it wasn't my idea! All I was saying was if someone deemed it to be worth it financially they could get round the childminder problems, by using each other as nannies.

I've never looked into tax evasion, but like I say Ofsted do have procedures to prevent it so they must think someone will think it worth a try?

the other comment wasn't to you Jinsei it was to Napa who said 'childcare costs are not at all tax deductible'.

Why is sm so disturbed on this thread?

OP I've been wanting to know the answer to this for years but especially now as we are losing out - again!

You don't save 40% tax by forming a limited company. You pay tax on profits then tax on dividends. You save about 10% And the govt is tightening up on people using it incorrectly.

I agree with you OP, probably because I'm American & I think couples should get tax deductions for each child & other dependents, too. I have heard that other countries in Europe tax harder the child-free and tax much less those with children than does the UK.

"I thought loads of gov research shows a stay at home parent is better for family life (if you have the luxury of that choice). Shame they don't support this. "

Actually, new research shows otherwise. Two happy parents is what is best for family life (no matter whether both are working or not). I know loads of happy working parents. And loads of sahp who aren't very happy.

it seems completely counter-intuitive what the OP is suggesting - the tax free allowance is relevant to what an individual is earning, not family income. So if you aren't working then you haven't got a tax free allowance, have you?

Remember that a sahm receiving child benefit is having full NI contributions credited to her record and will receive full pension as a result.

re Child care costs attributed to both parents, as allowing both to work and 'what's the point' the point may be that it is an investment in the future - staying in the workplace gives access to ongoing professional development and workplace training, promotion, a better paid job etc, while people returning after a long break find it very hard to enter the workplace even at the level they left it.

blu I don't think the Home Responsibility works like that any more. It is, I imagine, linked to the age of your youngest child, and stops when they get to 5 or is it still 9, as per when a LP has to seek work? The Ch B continues, of course.

Looking after children is an investment in the future, too.

It's reasonable to point out that th government looks at household income when it will reduce expenditure (eg: current debate over cb) but independent taxation is an important principle when a household view would ,eave people better off.

I KNOW looking after children is an investment in the future.

My answer was specifically about people who look at the ECONOMICS of the cost of childcare and decide that a woman might as well stay at home. ECONOMICALLY it isn't quite that simlple.

I used to muse about this when I was a SAHP. My idea was that everybody over the age of 16 could annually elect which NI number their TFA should apply to. SAHPs could elect their partners NI number, non-working children could elect one of their working parents NI number. Even if you were working you could still apply your TFA to someone else if you earned less than that amount. I though it was good in principle although I'm sure someone will come along and tell me it would be unworkable!

I think the more women we get into work the better. The more women that work, the more we'll start evening out unfair pay between men and women, the better we'll make things for our children in the future. I know it may seem unpalatable but while we all still need to get by with money, we might as well try and make it as good for women in the workplace as we can.

I would rather see extra money go to carers and single parents tbh.

Sorry blu I take your point. But I am old enough to remember when equality was about the right to both have flexibile time, to share parenting. And a time when lone parents were being told to put their children into nursery and work in a different nursery themselves, at the same time as people were moaning about children not having enough parenting.

If it hadn't been for Home Responsibility Protection I would not now qualify for state pension. I have worked outside the home, but it has been patchy because of my health. I got 18 years HRP - ie till youngest child was 16 (but some overlapped with me working and paying NI) and needed 30 qualifying years, which I have got through HRP, working or signing on.